Allied Irish Banks Plc v Greene
| Jurisdiction | Ireland |
| Judge | Mr. Justice Garrett Simons |
| Judgment Date | 19 August 2022 |
| Neutral Citation | [2022] IEHC 493 |
| Court | High Court |
| Docket Number | 2020 No. 276 SP |
[2022] IEHC 493
2020 No. 276 SP
THE HIGH COURT
Well charging orders – Loan facilities – Mortgage – Plaintiff seeking well charging orders – Whether the plaintiff had established that a mortgage or charge was created over the defendant’s interest in the property
Facts: The plaintiff, Allied Irish Banks plc, applied to the High Court for well charging orders. The basis for the application differed as between the two defendants. As to the first defendant, Ms Greene, the application was grounded on a number of loan facilities granted to her personally. It was a condition of the loan facilities that they be secured by way of an equitable mortgage by deposit of land certificate. As to the second defendant, Mr Greene, the application was grounded on a written guarantee given by him in respect of the indebtedness of the first defendant.
Held by Simons J that, having regard to the legal test as set out by the Court of Appeal in Promontoria (Oyster) DAC v Greene [2021] IECA 93 (at paragraphs 46 to 52), the plaintiff bank had made out its proofs in relation to the first defendant; in particular, the plaintiff bank had adduced evidence which related the debt to the undertaking to deposit title documents and that the security so created had since been protected by registration as a lien under s. 73 of the Registration of Deeds and Title Act 2006. Accordingly, Simons J held that a well charging order would be made as against the first defendant in respect of her interest in 19 Hamlet Avenue, Chieftain’s Way, Balbriggan (the property).
Simons J held that none of the reliefs sought in respect of the second defendant were available in the proceedings in circumstances where the plaintiff bank had not established that a mortgage or charge was created over his interest in the property.
Application granted in part.
Keith Rooney for the plaintiff instructed by Mason Hayes and Curran LLP
No appearance by either defendant
JUDGMENT of Mr. Justice Garrett Simons delivered on 19 August 2022
This judgment is delivered in respect of an application for well charging orders. The basis for the application differs as between the two defendants. As to the first defendant, the application is grounded on a number of loan facilities granted to her personally. It was a condition of the loan facilities that they be secured by way of an equitable mortgage by deposit of land certificate. As to the second defendant, the application is grounded on a written guarantee given by him in respect of the indebtedness of the first defendant.
The principal terms of the three loan facilities are set out in letters dated 17 May 2004 and 14 October 2006. In total, a sum of €336,500 was lent to the first defendant. This aggregate sum was divided as between three specific loan facilities. The first defendant had been an employee of the plaintiff bank and thus qualified to obtain certain loan facilities at preferential rates.
The purpose of the first two loans had been to purchase a dwellinghouse at 19 Hamlet Avenue, Chieftain's Way, Balbriggan (“ the subject property”). The purpose of the third loan, which had been granted in 2006, had been to restructure the first defendant's debt.
The facility letters indicate that security was to be provided by way of an equitable deposit of the land certificate for the subject property, together with a guarantee. As it happens, no land certificate was deposited with the plaintiff bank. This is because no land certificate was ever issued by the Land Registry in respect of the subject property. The plaintiff bank relied instead on a solicitor's undertaking, to deliver the title documents to it, as giving rise to an equitable mortgage. This undertaking appears to be dated 9 June 2004.
The guarantee was entered into between the plaintiff bank and the second defendant on 1 November 2006. It is expressly provided that the total amount recoverable from the guarantor shall not exceed the sum of €336,500 together with interest thereon from time to time (whether before or after judgment) at the plaintiff bank's lending rate from the date of demand by the bank for payment until full discharge.
As a result of amendments introduced under the Registration of Deeds and Title Act 2006, the procedure whereby an equitable mortgage could be created in respect of registered land by way of deposit of a land certificate was abolished. The holder of an existing equitable mortgage could apply to have a lien registered as a burden against the title. This was subject to a cut-off date of 31 December 2009.
The plaintiff bank applied to register a lien in respect of the subject property in February 2008. A copy of the folio in respect of the subject property, Folio 169302F County Dublin, has been exhibited. There is an entry dated 11 February 2008 in the following terms:
“Lien pursuant to Section 73(3) of the Registration of Deeds and Title Act, 2006, in favour of Allied Irish Banks plc.”
Following default on the part of the first defendant in making payments pursuant to the loan facilities, the plaintiff bank, through its solicitors, made a formal demand for repayment on 5 November 2014.
By a second letter dated 5 November 2014, the plaintiff bank demanded immediate payment pursuant to the guarantee entered into by the second defendant. This letter of demand identified the sum of €336,500 as being payable. This, it will be recalled, was the maximum sum allowed under the terms of the guarantee.
It is stated in the grounding affidavit that the subject property is the primary residence of the defendants. Notwithstanding this, the plaintiff bank offers the view that the Central Bank's Code of Conduct on Mortgage Arrears (“ CCMA”) does not apply as each of the loans was provided on a commercial basis, and not as personal housing loans. Nevertheless, the plaintiff bank...
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Allied Irish Banks Plc v Kellie Greene [Otherwise Kellie Byrne]
...Chieftain’s Way, Balbriggan (the Property). As appeared from the principal judgment delivered in the proceedings on 19 August 2022 ([2022] IEHC 493), the High Court held that the first defendant’s interest in the Property stood charged with a debt in a specified sum, which was owed by the f......